German automaker Volkswagen has announced its plan to invest about $1 billion in China for the development of electric cars, as well as to launch a new vehicle that targets the higher end of the market. The investment will be used for an electric car development and business center in Hefei, which is near Shanghai, and is expected to be operational by 2024 with more than 2,000 employees. The new business center will be operated by a new company called “100%TechCo,” and by involving local suppliers at the early stage of product development, the company claims it can reduce product and tech development times by about 30%.
Volkswagen’s new all-electric ID.7 sedan also made its world premiere at the Shanghai auto show. The car is set to launch in China and Europe this fall, and in North America next year. The company did not disclose the price, but said it is its first fully electric car “for the upper mid-size class.” The vehicles for China will be produced locally, while those for Europe and North America will be produced in Germany. The Chinese market has become increasingly important for Volkswagen, as German investment in China grew by nearly 61% in the first quarter from a year ago.
According to the China Passenger Car Association, China is the largest market for electric cars globally, and in March, luxury car sales grew by 17% year-on-year, surpassing the 0.3% increase in passenger car sales.
The ID.7, Volkswagen’s new electric sedan, is expected to have a range of up to 700 kilometers (435 miles) and incorporate features like lane-changing assistance and parking assistance, according to a press release. The sedan will also feature an augmented reality head-up display, which allows the driver to see information about the road and car as projections on the road ahead. The ID.7 will come equipped with a panoramic sunroof, whose transparency can be changed using a function similar to a touch screen or through voice commands, the company announced.